Apple to sell subscriptions through App Store

SAN FRANCISCO — Apple Inc.,
breaking from its past practice, will soon allow customers to buy
subscriptions and other digital content from its popular iPhone and
iPad devices, but some of those changes may prove problematic for
companies such as Amazon.com.

Under the plan unveiled Tuesday by Apple, sales through the new service would be billed through the App Store,
the same as regular applications. Apple said its new service will allow
publishers to sell subscriptions from within their apps.

Such a service has been widely expected for some time, and Apple teamed up with News Corp. earlier in the month to launch The Daily, a “newspaper” for the iPad selling for 99 cents a week. News Corp. is also the owner of MarketWatch, publisher of this report.

However, as part of Tuesday’s announcement, Apple
said it will no longer allow app publishers to link to outside Web
pages to sell content.

Amazon’s Kindle app is one of the most popular on the App Store. The app allows customers to read e-books purchased through the company’s Kindle Store
or on other Kindle devices. To date, Amazon hasn’t sold e-books through
the Kindle app itself; rather, the app links to Amazon’s website, where
customers can order e-books.

An Apple spokeswoman said that companies such as
Amazon will be allowed to sell e-books from within their apps. But
those sales will be subject to Apple’s fee requirements, which
currently allow Apple to collect 30 percent of the revenue from such
sales.

Apple and Amazon became competitors in the e-book
business when Apple launched the iPad last April. Apple’s iBooks app
allows customers to purchase e-books through its own online bookstore.

Representatives for Seattle-based
Amazon couldn’t be immediately reached for comment. The new arrangement
would theoretically make Kindle books sold through apps on Apple
devices less profitable than the same versions sold for Amazon’s own
device.

Many analysts already believe that Amazon sells
Kindle content at near-loss in order to build up share of the
fast-growing e-book market. The company doesn’t disclose specific sales
data for the Kindle device or its e-books.